Analysts say buying the dip could be key as altcoin markets show bullish divergence and ETFs await approval.
A massive bullish divergence is emerging in the altcoin market, suggesting that the current downturn could offer new opportunities for investors. Analysts are pointing to signs that the market may be preparing for a rebound, with some calling it an ideal moment to buy the dip. This potential turning point comes at a time when attention remains focused on upcoming crypto ETF approvals and broader institutional participation.
Bullish Divergence Fuels Market Optimism
Analysts are observing patterns that suggest a reversal in altcoin performance after weeks of uneven trading activity. Michael van de Poppe noted that the market is showing strong divergence, which could mark the start of a recovery phase. Many traders believe this technical signal supports renewed buying activity.
Over the past 24 hours, major altcoins have outpaced Bitcoin in growth, lifting overall crypto market capitalization to $3.86 trillion. Ethereum gained 4%, Solana surged 7.8%, XRP advanced 3%, and Dogecoin rose 4.9%. Bitcoin showed more modest growth, gaining 1% and holding near $111,000.
Despite the optimism, the derivatives market suggests caution, as traders continue to buy put options. Analysts point out that this reflects mixed investor sentiment, but the presence of buyers on dips signals underlying confidence. Some market observers argue that weaker hands are exiting, paving the way for stronger support levels.
ETF Launches Seen as Key to Altcoin Season
Bitfinex analysts recently said that a broad altcoin season is unlikely until more cryptocurrency ETFs receive approval. They explained that sustained inflows into investment products will create demand that does not0729316780 depend on short-term price moves. This could drive a broader revaluation across the digital asset market.
Currently, the US Securities and Exchange Commission is reviewing more than 70 applications for altcoin-based ETFs. Products linked to Solana, XRP, and other assets remain under consideration after previous delays. Market watchers expect that fresh approvals could accelerate institutional entry into the altcoin sector later this year.
Coinbase Institutional’s head of research, David Duong, presented a different outlook, suggesting that current market conditions may already be shifting toward an altcoin season. He pointed to September as a possible turning point. Analysts remain divided, but both views underline the role of institutional products in shaping the next phase of growth.
Political and Institutional Forces Reshape Market Dynamics
Nonetheless, FBS suggests that the altcoin market is now heavily influenced by political and institutional factors. Liquidity is flowing mainly into leading tokens, with the top 10 assets accounting for over 70% of the altcoin market cap. This concentration reflects a different environment compared to 2021, when gains were more broadly distributed.
Policy decisions in the United States are also shaping expectations. Since returning to office, President Donald Trump has supported measures to expand crypto adoption. His administration has opened retirement funds to digital assets and advanced pro-crypto regulations that encourage wider institutional participation.
This political environment, combined with pending ETF approvals, is creating conditions that analysts say may strengthen the case for buying the dip. Traders remain cautious, but the market is showing signs that a recovery in altcoins could follow as institutional demand grows. Investors are watching closely to see whether new products and policies accelerate this trend in the months ahead.
